The Foxtrott Group has recently discovered a new market for its products. The company expects to grow rapidly while its competitors have not realized this opportunity. Dividend payments are expected to increase by $8\%$ per year for the next four years. But after the competitors take over, the growth will be slower or $4\%$ per year for the foreseeable future.

The company's last dividend payment was $$2\mathrm{.}10/$share$,($ie D$0=$ $$2\mathrm{.}10/$share$)$ and the investor's return to the company is $12\%.$ So what is the market price per share now $($ie P$0)?$

Answer rating: 100% (QA)

Sure I can help you with that The Gordon Growth Model GGM can be used to estimate the intrinsi... View the full answer